Question: Partners Dahl and Sullivan wish to avoid the unlimited personal

Partners Dahl and Sullivan wish to avoid the unlimited personal liability of the partnership form of business, so they are incorporating the company as D & S Services, Inc. The charter from the state of Texas authorizes the corporation to issue 25,000 shares of 5%, $75 par preferred stock and 300,000 shares of no-par common stock. In its first month, D & S Services, Inc., completed the following transactions:
Jan 3 Issued 5,400 shares of common stock to Dahl and 4,100 shares to Sullivan, both
for cash of $8 per share.
12 Issued 1,000 shares of preferred stock to acquire a patent with a market value of
$75,000.
22 Issued 1,400 shares of common stock to other investors for $8 cash per share.

Requirements
1. Record the transactions in the journal.
2. Prepare the stockholders’ equity section of the D & S Services, Inc., balance sheet at December 31. The ending balance of Retained Earnings is $73,000.


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  • CreatedApril 29, 2014
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